Nigeria is blessed with significant oil and gas reserves, making it one of the largest producers and exporters of hydrocarbons in Africa.
Despite this status, opportunities for investors and project developers continue to grow, owing largely to efforts by the government to mitigate production decline, bolster electrification and industrialization while consolidating the country’s position as a regional powerhouse.
With the aim of connecting investors to Nigeria’s evolving energy prospects, this year’s edition of the African Energy Week (AEW) conference will host ‘Invest in Nigeria Energies,’ a session dedicated to exploring the country’s investment potential.
The session is led by high-level government representatives including Minister of State for Oil, Heineken Lokpobiri and Minister of State for Gas, Ekperikpe Ekpo, among other industry experts. With a focus on key areas such as upstream development, refinery commissioning, infrastructure expansion, renewable integration and rural electrification, this session will make a strong case for investing in one of Africa’s biggest energy markets.
With its abundant oil and gas reserves, Nigeria is making strides in upstream development. Holding proven oil reserves of approximately 37 billion barrels and natural gas reserves of around 200 trillion cubic feet – a figure set to increase three-fold as new discoveries are made -, the country stands among the top oil and gas-rich nations globally.
Major projects include the $3.15 billion OML 13 Field; the 110,000 barrel per day (bpd) Bonga North Field; the 85,000 bpd Okpokunou/Tuomo West Cluster Development and many more. On the upstream gas front, policies such as Nigeria’s ‘Decade of Gas’ program have played a key role in attracting natural gas players and funders.
The program has identified 20 critical gas projects which the government aims to sign. This underscores the potential for billion-dollar gas investments and is poised to bolster development across the entire gas value chain.
Recognizing the importance of countering underinvestment in the upstream sector, Nigeria is actively seeking new investment partners. The government is employing initiatives to create a conducive business environment, offer attractive fiscal terms, and streamline regulatory processes to attract investors.
These efforts aim to stimulate increased capital inflow and foster mutually beneficial partnerships in the Nigerian energy sector with local and international investors. Under regulatory frameworks such as the Petroleum Industry Act – signed into law in 2021 -, the country plans to use oil and gas investment as a catalyst for sustainable socioeconomic growth.
Meanwhile, Nigeria’s downstream sector represents a particularly lucrative investment opportunity. Under efforts to reduce the reliance on imports – 80% of petroleum products are currently imported -, the Nigerian government is prioritizing downstream developments. This year, Africa’s biggest oil refinery, the 650,000 bpd Dangote Refinery, came online in the country, revolutionizing Nigeria’s economy.
An existing agreement with the Nigerian National Petroleum Corporation, which owns a 20% stake in the refinery, ensures the supply of 300,000 bpd of crude oil to the facility. The need to increase investment in Nigeria’s upstream industry is underpinned by supply concerns for the refinery.
The country is also fostering regional cooperation with countries such as Morocco for the development of the Nigeria-Morocco Pipeline. The pipeline is expected to span a distance of 7,000 km, with a transportation capacity of around three billion cubic feet of gas per day, and is anticipated to play a transformative role in West Africa’s energy landscape.
Additionally, the country has also signed a deal with Equatorial Guinea for the country to process Nigerian gas at its Punto Europa facilities. Nigeria is also working with Algeria and Niger to actively advance the completion of the Trans-Saharan Gas Pipeline and initiate new project developments.
Meanwhile, to meet growing energy demand, Nigeria is prioritizing the development of robust power transmission and distribution infrastructure.
At AEW 2023, panelists will delve into the government’s plans and policies that encourage investment in this critical area. Enhanced infrastructure will not only address current power supply challenges but also create opportunities for private investment, including partnerships in renewable energy projects and modernizing the grid.
“Nigeria’s energy sector holds immense potential for investment and growth. With a commitment to revitalizing the upstream sector, developments in its downstream sector, partnerships and expanding infrastructure, Nigeria is creating a favorable environment for investors.
“By leveraging these opportunities, we can drive economic development, unlock the country’s vast resources, and shape a sustainable energy future for Nigeria and the entire continent,” states NJ Ayuk, Executive Chairman of the African Energy Chamber (AEC).
Looking ahead, the Invest in Nigeria Energies session at AEW 2023 will present a compelling case for investment in Nigeria’s energy sector in hopes of transforming the country and the continent’s energy landscape.
Regional and global investors are met with both a unique and highly strategic opportunity to connect with government, engage with industry experts and sign billion-dollar deals.